An industry expert has said the Tesco-Booker deal, which was given provisional approval by the CMA last week, will make wholesalers “tougher, leaner and more resilient”.
David Gilroy, who runs online platform Store Excel, said he did not believe the merger would signal lower prices but rather the focus would be on improved service, range, availability and customer engagement.
Writing in his LinkedIn blog, he said: “The odd price bomb might be dropped, but that is almost established practice across the whole industry. Both Booker and Tesco have to return consistently improving profits to satisfy shareholders.”
He added that wholesalers could counter the Tesco-Booker effect by having a plan of their own and “playing to their strengths”.
Among areas he highlighted as an advantage for smaller wholesalers were excellent personal service, the ability to be more agile and flexible on range, the ability to attract suppliers and to be at the centre of a local business community. “A turbo-charged Booker will be a formidable competitor, but I’m confident that there is a good profitable future for well-run, adaptable and innovative wholesalers,” he said.